Shared Solar Programs: Growing the Market

Erica Schroeder McConnell

Solar Power International 2013

Why Shared Solar?

I want to benefit from renewable energy generation, but I…

–  Rent my apartment –  Live in a multitenant building (e.g., a condo) –  Have insufficient or problematic roof space

(e.g., too shady) –  Am just not interested in on-site generation

(maintenance responsibility, aesthetic issues, etc.)

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Only 25% of residential roofs permit on-site generation

Paul Denholm & Robert Margolis, NREL, Curves for Rooftop Solar PV-Generated Electricity for the United States 4 (Nov. 2008), http://www.nrel.gov/docs/fy09osti/44073.pdf

Serving More Energy Consumers

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If just 5% of U.S. households invested in a 5-kW interest in a shared solar system… … we’d see over 28 GW of additional solar capacity!

http://quickfacts.census.gov/qfd/states/00000.html

The Vote Solar Initiative

Net Metering Shared Solar

Guiding Principles for Shared Solar

4 IREC, Model Rules for Shared Renewable Energy Programs (2013), www.irecusa.org/wp-content/uploads/

2013/06/IREC-Model-Rules-for-Shared-Renewable-Energy-Programs-2013.pdf

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5 5 Based on IREC research as of May 2013, www.irecusa.org

Shared Solar Growth in the U.S.

Type of Energy Service Provider

6 Based on IREC research as of October 2013, www.irecusa.org

Average Program Size

7 Based on IREC research as of October 2013, www.irecusa.org

Coop – 213 kW

Muni – 479 kW*

IOU – 5165 kW

* Excluding SRP 20-MW program

Critical Program Elements

1.  Allocating the benefits of participation 2.  Valuation of the energy produced 3.  Program administration 4.  Shared solar facility ownership 5.  Shared solar facility size and location

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There are several ways to design a program… … choose what works for your community

Allocating the Benefits of Participation

•  By payment? – Raises security and tax issues

•  By bill credit – Dollar credit works better (vs. kWh credit) – Can avoid security and tax concerns – Relatively easy to administer – Familiar to participants and utilities – But what about valuation?

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Valuation of Generation

Embedded Cost-Based Approach •  Credit based on participants’ retail rates—

generation, transmission and/or distribution rate components

•  Can get more complicated with TOU rates and non-kWh rate components, e.g., demand charges

•  Example: Xcel Solar*Rewards Community program in Colorado—SRC credit for residential customer ≈ $0.074/kWh

10 www.xcelenergy.com/Save_Money_&_Energy/For_Your_Home/Renewable_Energy_Programs/Solar*Rewards_Community_-_CO

Valuation of Generation

Value-Based Approach •  Based on the value of the generation to the

utility, weighing costs and benefits •  Example: Holy Cross Energy community

solar—$0.11/kWh –  Similar to Austin Energy value of solar tariff

(VOST) for on-site residential solar—$0.128/kWh

11 Austin Energy: http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=TX139F

Holy Cross Energy: http://www.easycleanenergy.com/faq.aspx

Valuation of Generation

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Costs Benefits

and more

Capacity benefits

Avoided line losses

Avoided generation and

T&D

Incentives

Administrative costs

Lost revenue

Value-Based Approach

Additional Considerations

•  Number of program participants •  Minimum and maximum subscription sizes •  Portability and transferability of participation •  REC ownership •  Consumer protection •  And more…

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Ultimately, the community’s goals, priorities and constraints determine

what the program looks like

Further Resources

www.nrel.gov/docs/fy11osti/49930.pdf

•  Shared Renewables HQ: www.sharedrenewables.org

•  IREC Shared Renewables Program Catalog: www.irecusa.org/regulatory-reform/shared-renewables

www.irecusa.org

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THANKS to our generous sponsors for the 2013 3iForum and 3iAwards

Questions? Erica Schroeder McConnell

510-314-8206

emcconnell@kfwlaw.com

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